FEATURE: Is it still possible to make a living from music?

 Is it even possible to make a living from music anymore? Answer: No! Well, workshop over, I hope you have a nice rest of the day. Stop, stop, stop, such a statement would not only be presumptuous, it would also be factually incorrect in certain constellations. We all have a DJ in our circle of friends who plays six times a month and ends up with at least €3,000 before taxes at the end of the month. Sounds like it's viable, right? Well, this feature is intended to give a true insight into the economic structures of the music business and to clear up as many prejudices as possible so that the future musician knows what and, above all, what not to expect.

Vision and reality

Professional musicians know the party situation all too well. Anyone who cites musicians when asked about their personal source of income receives a mixture of admiration and pity, unless their name is linked to a nationally known trademark of a band or solo artist. On the one hand, with the appropriate external representation of the artist, the never-ending dream constellations of wild and extravagant sex, drugs and rock'n'roll immediately pop up in the person you are talking to, and on the other hand, it only lasts for a short time, in an indirect or even very direct way the question “And can you make a living from this?” arises. Of course the party answer is “yes”, knowing full well that you probably interpreted the definition differently than your counterpart. While the interlocutor sees us in his imagination on a large open air in front of thousands of screaming fans, highly paid and sold-out concerts, garnished with high-dollar record contracts, we are still thinking about how much guitar lessons, trade fair sound systems and the half-playback hit duo are still using the above definition lets you unite yourself.

To define it briefly, of course you can make a living from music, just ask again about the fees that KISS, for example, receive on their current farewell tour or the guarantee of 1 million per band member that the Rolling Stones still receive per show some time ago on their tours. In this feature we are concerned with a constellation that probably 99% of all musicians have started with and perhaps will continue to do so for a while, i.e. a band of 4-6 musicians, each playing a different instrument to cover the respective frequency range and all have set themselves the goal of writing their own songs that are useful to the band and of having so much economic success with them that all band members can make an equal living from them. To get straight to the point, in this situation the answer is actually as described in the first two sentences of this article.

The school of hard knocks

Rock is dead! Oh man, how many times has this sentence been used and how often it has been misused by artists to perhaps justify the inferiority of their musical product and the resulting decline in income. For the sake of simplicity, let's stick with the countless varieties of rock music and list the relationships. Emerging in the 1950s, adopted in the 1960s and perfected in the 1970s, rock music always had something “dangerous” about it; it always had to be a little “outlaw” in order to consolidate one’s personal status. This external representation has long since passed over into hip hop, even to the point of verbal perversion, while rock music tries to maintain a touch of provocation with the extreme varieties of metal, which have long since moved away from any harmonic structure. What almost 5 decades ago made law enforcement and moral guardians blush with anger, today just passes for pop music in the oldies range and no longer has any fascination for the next generation of music.

Due to the fact that current DAWs with appropriate emulations enable anyone to make a piece of music of any quality available worldwide via streaming services, there is no longer any distinction in the first exploitation step between a global star like Paul McCartney and an acoustic burp in the hobby sector. The result is a hopeless oversaturation with output of all kinds, which can only be countered with massive marketing and promotional activities to draw attention to a still unknown artist. This means that you first have to invest a huge amount of money into an artist before you can even think about making money. Heinz Rudolf Kunze once told me that he only did lousy things with his first three albums, with the fourth album the numbers went black, albums five and six paid off the debts and from album seven onwards a profit was made. Over 10 years had passed... This form of artist development is long gone and is not coming back. But what are the earning potential and who is to blame for these numbers?

The story of the cashier at Aldi

Ok, what kind of income do we actually have? What if I told you that at every big festival with international stars, maybe 25% of the bands, i.e. only the top ones on the poster, actually make a “normal” living from music and maybe the two headliners have the same standard of living , which we all still associate with the extravagant life of the eighties. All other artists have a daytime job.

Well, we would have

1.) Sales of physical recordings via retail or online shops
2.) Digital exploitation via streaming and downloading
3.) Live fees
4.) Selling merchandise
5.) GEMA
6.) GVL

P.S. In order not to throw in the towel straight away, let's leave out the Corona catastrophe and only look at the period before 2020 and perhaps again from the end of 2022.

Regarding 1.) The area of physical recordings, especially CDs, has almost come to a standstill. Although there is a relatively stable area of around 7% in vinyl sales, this cannot stop the decline in income from physical sales. Quote from Warren Hayes: “I used to have a budget of $300,000 per album and sold 300,000 copies of the resulting album. Today I have a budget of $30,000 and am selling 300 pieces.

Based on these figures, although he may have exaggerated the last figure a bit, record companies now only pay advances for recordings to established acts, with advances having decreased by an average of around 70% over the last 20 years. Not only do newcomers have to pay for all recordings for their albums out of their own pocket, the majority of record companies now charge artists a fee to include them in their distribution structure due to the ever-slumping income. The band musician who works a regular 9-to-5 job, saves his annual vacation for performances and pays all expenses himself in order to be able to at least take part in the rock 'n' roll circus a little bit is now the standard, not the exception.

2.) Everyone has heard about it, but the exact numbers are even more terrible than you could even imagine in your worst dreams. Sure, an Ed Sheeran, who has billions of clicks on Spotify and can therefore negotiate separate deals with the streaming platforms, also earns a hefty multi-digit million sum in this area per year, but the common musician only receives fractions of a cent for it his performance. In a nutshell without any claim to being up to date: Streaming a track on Spotify Premium costs around €0.003, of which your digital distributor takes around 20%, or the record company takes around 70% in a standard deal, making around €0.001 €. You then divide this generously by the number of musicians in the band, which makes around €0.0002 per song with 5 musicians. Your album has 10 tracks, i.e. H. If 10,000 fans listen to your entire album, you will receive €1 per musician! Do you think that's ridiculous? That was the income for a Spotify Premium account, with a free account the income is reduced to approx. 1/10. Then around 100,000 fans have to hear your album so that each musician receives €1!

3.) Due to the Corona pandemic, prices in transport have exploded by almost 100%. A Nightliner in the middle segment including a driver currently costs around €1,750 per day, which means that a large part of the fee goes towards producing an average tour. In the best case, a little remains with the artists, but the majority of tours are also in the red. Then why play live at all? Now, so we can launch the only remaining revenue generator, this

Regarding 4.) Merchandise. This is actually the last opportunity for the artist to improve the economic situation in a relatively simple manner. Of course, the record companies have discovered this for themselves, which is why in the newcomer sector almost only so-called 360 degree deals are offered, which means that the record company shares in all the income that the artist earns in any way from his music. Evil record companies? Not at all! Almost all lower and medium-sized labels are fighting for survival and almost all of them are only run as a hobby.

5.) Getting upset about GEMA's distribution levels means bringing owls to Athens. For decades, attempts have been made to give the private company with a public mandate a fairer distribution of the income generated from the cross, but due to the structure that the more sales you generate with your music, you also receive a higher and higher share from GEMA the “common” musician only gets the breadcrumbs that he is assigned as an affiliated member.

6.) Once a good thing, as a musician you received your Christmas bonus in the form of a percentage distribution on all sound recording sales in December. This “gratification” was canceled overnight without giving any reasons. Just think about whether you would carry out such an action in the public service or other service sector. But a real musician has no means of exerting pressure. What should you do as a threat? Strike? Don't write songs anymore? But the municipalities are shaking. The value of art in general beyond the subsidized cultural institutions in Germany has only just become apparent during the Corona pandemic. “Not systemically relevant”, or in other words, unimportant and without measurable value.

Let's make it short. Of course, established bands live by their name and still manage to generate enough sales until their final expiry date, which has already been mercilessly overused by some artists, to be able to lead a good to very good life. But anyone who now cites the perhaps five newcomers who have achieved a certain reputation worldwide within a year as a counter-argument and forgets the thousands upon thousands of bands who operate music as a subsidy business and looks away with a glorified look is indulging in an illusion . To get to the point, the classic band that makes it to the top both artistically and economically within the band will no longer exist in the future and will instead be replaced by countless hobby bands who have to perform at maximum cost price. If you ever plan to start a family and support it as a sole earner, you should definitely choose another career.

So, at the next party, always remember that your musical newcomer, who makes a living from music, most likely has one or more other irons in the economic fire, or he may earn significantly less than the cashier at Aldi. But that doesn't mean you can't have a great party with him ;-)

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Additional Informations:

The pursuit of a career in music is often fueled by passion, creativity, and a deep love for the art form. However, the financial landscape for musicians can be as diverse as the melodies they create, with income sources ranging from live performances to streaming royalties. In this comprehensive analysis, we delve into the intricacies of musicians' average incomes, exploring the various revenue streams, disparities across genres, and the impact of the evolving music industry.

I. Live Performances:

A. Income Range:
   1. Musicians often rely heavily on live performances as a primary source of income.
   2. The income from gigs can vary significantly, ranging from modest payments at local venues to substantial fees at major festivals and concert halls.

B. Considerations:
   1. Venue size, location, and the artist's popularity all influence the earnings from live performances.
   2. Expenses such as travel, accommodations, and equipment can impact the overall profitability of a tour.

II. Streaming and Digital Sales:

A. Income Range:
   1. The rise of digital platforms has transformed the music industry, offering musicians new revenue streams.
   2. Streaming royalties, however, can be relatively low, with artists earning fractions of a cent per stream.

B. Considerations:
   1. Platform choice, audience size, and region can affect streaming income.
   2. Diversifying digital sales through platforms like Bandcamp or Patreon can provide additional revenue streams.

III. Record Sales and Physical Merchandise:

A. Income Range:
   1. Traditional record sales have declined, but physical merchandise remains a lucrative revenue source for many musicians.
   2. Vinyl records, CDs, and merchandise sales at live shows contribute significantly to artists' incomes.

B. Considerations:
   1. Independent artists may benefit more from direct-to-fan sales, retaining a larger share of the profits.
   2. Creative and visually appealing merchandise can enhance sales and fan engagement.

IV. Royalties and Licensing:

A. Income Range:
   1. Musicians earn royalties through various channels, including radio airplay, TV, and film licensing.
   2. Licensing deals for commercials, movies, and TV shows can provide substantial one-time payments.

B. Considerations:
   1. Success in securing licensing deals often depends on the artist's visibility, genre, and the potential fit of their music with a particular project.
   2. Joining a performing rights organization (PRO) helps musicians collect royalties for public performances and broadcasts.

V. Teaching and Session Work:

A. Income Range:
   1. Many musicians supplement their income through teaching music lessons or participating in session work.
   2. Session musicians can earn fees for recording sessions and live performances with other artists.

B. Considerations:
   1. Teaching opportunities vary based on the musician's expertise, reputation, and local demand for music education.
   2. Session work often requires networking and versatility in playing different styles of music.

VI. Challenges and Disparities:

A. Genre Disparities:
   1. Income disparities exist across music genres, with pop and mainstream genres often yielding higher financial returns.
   2. Musicians in niche or experimental genres may face challenges in monetizing their work.

B. Emerging Artists:
   1. Emerging artists often struggle to establish consistent income streams, especially during the initial stages of their careers.
   2. Building a fan base and industry connections is crucial for unlocking diverse revenue opportunities.

VII. The Impact of the Evolving Music Industry:

A. Digital Transformation:
   1. The shift from physical to digital formats has altered revenue models for musicians.
   2. Adaptation to digital platforms and social media is essential for reaching a wider audience and maximizing income.

B. Advocacy and Fair Compensation:
   1. Ongoing advocacy efforts seek fair compensation for musicians, particularly in the context of streaming royalties.
   2. Awareness and support for musicians' rights can contribute to a more equitable financial landscape.

Conclusion:

The average incomes of musicians are a complex interplay of various factors, from the genre they specialize in to the platforms they leverage and the diversity of their revenue streams. While challenges and disparities exist, the evolving music industry offers both opportunities and hurdles for artists navigating the financial aspects of their careers. Ultimately, the pursuit of a sustainable music career requires a multifaceted approach, combining artistic passion with strategic business acumen to thrive in a dynamic and competitive landscape.